Historically, connecting to the Internet has always been on computers, but over the last five years connectivity is no longer confined to a desktop or laptop – all thanks to the evolution of “smart devices”. Smart, or connected devices changing how people create, consume, share, and control the content in their life.

Consumer Electronic Show (CES) in January provided preview of the new direction of major electronics manufacturers, and how they plan to design devices that not only provide value by leveraging smart capabilities, but also solve problems in an intuitive way. According to the GSMA, 90% of TVs at CES, 70% of automotive devices, 44% of health devices, and 30% of cameras were Internet connected.

Of all connected devices at CES, 30% were from the “home lifestyle” category, which includes TVs, refrigerators, and even washing machines!

What it means for the living room

The potential benefits of having so many connected home devices are mind boggling, but this post covers how these changes could affect the current family living room.

Smart phones changed the way we use our mobile devices. They provided easier and more efficient access to music, games, social media, and communication tools like instant messaging and the almighty email. Most people I know, even the highly skeptical, never looked back after upgrading to a smart phone (be it Android, iPhone, or Blackberry).

A similar principal applies to the connected TVs showcased at CES – picture many of the benefits that a smart phone brings, and apply it to your living room on a screen 10 times bigger. Older TV owners can still rejoice that set top boxes like ROKU, Boxee, or AppleTV, and game consoles such as Xbox can be used to turn any TV into some form of Connected TV.

1. Social TV

People love to talk about TV with friends, which make social elements an integral feature for all connected devices. Social components should be integrated seamlessly when possible. One main problem is that unlike smart phones, TVs are “shared screens” – making it even more important to utilize social privacy elements. Michelle, a colleague here at Social Media Group recently shared her thoughts on The Rise of SocialTV here.

2. Apps

Apps have been integral part of making smart phones the awesome devices they are today. They provide a never-ending supply of new content to learn from or play with. The same is true for TV. Having access to apps will let users control what additional features, games or widgets they want to use, ultimately leading to a more controllable, and enjoyable viewing experience.

3. Custom Streaming

Continuing on the DVR trend, connected TVs will also allow viewers to choose what they want to watch, and when. As content producers continue to align their service offerings to support a streaming model, more people will continue to cut or cancel their cable/satellite bills. Netflix and Hulu have also helped push the streaming model to the mainstream. This is one of the largest game changing features of Connected TV – user control.

Internet Connectivity is no longer a feature that is limited to the top of the line TV models – it’s now a requirement. TV manufacturers have to rethink what a TV is, which includes how to leverage Internet capabilities, but more importantly the overall user experience that allows TVs to interact with traditional computers, smart phones, and tablets.

The Ecosystem Approach

Many major TV manufacturers lost money last year, Sony included. Samsung was fortunate to only incur reduced profit margins. The root causes were eroding retail prices, and sluggish consumer demand. The time has come where device manufacturers have to become content suppliers in order to maintain profitability and survive, which essentially means more ecosystems.

Molly Wood from CNET recently wrote her thoughts on what a connected device ecosystem really means:

A perfectly constructed ecosystem turns a smart phone, a tablet, or even a TV into a symphony of interoperable, always-on, one-stop-shopping gadget glory. No device is just a device, anymore. Now, every device is a platform, and everything works together perfectly

Love it or hate it, Apple pioneered the closed ecosystem with iTunes and iDevices. The closed ecosystem means more consumers are locked in – essentially raising the costs to switch to a different platform. Their strategy is paying off too, which is evident in their recent first-quarter record profit announcement. Rumors also suggest that Apple is making a big play into the TV market, a move that will definitely shake things up.

Samsung and Microsoft also have the right idea. Samsung has made major moves this year to create an ecosystem that will compete head on with Apple. Their TVs will work seamlessly with both their Tablets and popular (record breaking) smart phones. Microsoft’s new Metro UI will ensure Windows 8 devices, Windows Phones, and Xbox will all share a universal user experience and content repositories. Let’s not forget about Microsoft Kinect, which could bring a Minority Report type experience to your living room!

We’re moving into an all out clash of the TV titans for 2012. Apple, Microsoft, and Samsung will likely continue to fight over patents and designs, while advancing product capabilities, and refining their service offerings.

To Sum it Up

A huge influx in the variety and quantity of connected products are coming directly to consumers, but the true benefit of these changes really comes down to implementation.

Only time will tell if these products solve more problems than they make, but the awesome part is that this is one of the few circumstances where you can literally sit on the couch and enjoy the changes!